In my last blog, on Election Day, I mentioned the possibility that the first move may not be the real move. That was the case on election night. When it looked like Trump was going to win, the Dow futures were down over 800 points and the S&P 500 futures were down over 100 points. The Dow futures are now up 1800 points from those lows and the S&P 500 futures are up 180 points. What does all of this mean us for traders? In this rally we are also seeing a shift. Trump’s focus is on America and making it better. This means more focus on U.S. based companies. More growth can also mean higher interest rates, which is good for the financials. More grow also good for the industrials and manufacturing. Look at the chart below showing price performance of sector ETF’s for transportation, Bio pharm, industrials/manufacturing and financials. The time period is YTD through November 8th.

YTD-11-8

Now let’s look at the same ETF’s performance from November 8th to November 30th. You will notice they all have performed as good as or better in 15 days than they did previously YTD.

Percentage Price Change ETF 11-8_11-30

Now let’s compare four stocks from these sectors, Bank of America (BAC), United Airlines (UAL), Caterpillar (CAT) and Celgene (CELG) to four of the high flying stocks, Google (GOOGL), Facebook (FB), Amazon (AMZN) and Netflix (NFLX) using the same time frame as the above chart.

Percentage Price Change Stocks 11-8_11-30

I hope these charts have made it easier for you to see the shift. Everything goes in cycles, so when the markets shift you need to shift you’re trading to take advantage of the best performing stocks and ETF’s. Look for stocks in these industries that have not performed as well as the high flying stocks the past few years. They may just be the next high flyers.

I hope this helps,

Simpler is Better.

Tucker